Readers' comments

It is puzzling why Greece's nominal leaders are so adverse to providing leadership. What is to be done is blindingly obvious - Ireland has shown a lead. There will be no miraculous recovery in tourism but a continued decline. Nor, given the consequences of the EU's absurd agricultural CAP will the price of agricultural products suddenly reverse. There is an urgent need for an informed all-party debate (outside of the Parliament) to reach an agreement on how to restructure the country's public finances - something that goes beyond the traditional 4 or five commentators (including the moderator) all shouting at each other as on almost all of the Greek TV channels.
Greeks will assume almost any responsibility to ensure the future welfare of their children except pay their taxes. Why? Well why pay given the evident levels of corruption in some part funded by the inflow of EU largesse (>14% of government reveneues). The solutions are obvious. They might start with a 'dobbing in' phone line on tax evasion and corruption.

You acknowledge that the bail-out of a eurozone member state (or, for that matter, an EU non-eurozone member) is specifically forbidden – precisely by Article 103, section 1, of the Treaty establishing the European Community (TEC; Official Journal of the European Union (OJ) 29.12.2006 C 321 E/84). That article rules out not only any obligation to bail-out, but also any unilateral, voluntary and generous “assumption of the commitments of central governments, regional, local or other public authorities, etc.”, whether on the part of the Community or a Member States. No bail-out, period.

Yet you contemplate the possibility of a eurozone member state bail-out, a non-bail-out bail-out as in the case of New York City in the mid-1970s. Are you invoking art. 101 (for eurozone members; art. 119 for non-eurozone members) that allows the Council to grant financial assistance “Where a Member State is in difficulties or is seriously threatened with severe difficulties caused by natural disasters or exceptional occurrences beyond its control”, “acting by a qualified majority on a proposal from the Commission”?

Your text is ambiguous. Would there be or would there not be a bail-out? This is the question. Even unilateral aid from Germany would have to be authorized by the Council. That conditions for a bail-out would have to be tough, or be preceded by self-imposed fiscal austerity, is neither here nor there. The defaulting country can always turn down financial assistance if it does not like the conditions, but these may still be preferable to no bail-out.

The crux of the matter is the absolutely discretionary nature of a bail-out, depending exclusively on a Council’s decision on “exceptional occurrances”, on a recommendation by the European Commission.

It is bad enough for EU member states to be subject to the fiscal straitjacket of the so-called Growth and Stability Pact, without those members that comply being subjected to the cost of bailing-out those who do not comply. It is bad enough for the ECB to provide emergency financial assistance to banks at its own discretion, without being subject to rules as a Lender of Last Resort; now the Council is to provide financial assistance to member states at its own discretion?

Given the looming demographics and poor fiscal positions of the developed world, I venture to say that we'll gain a lot of experience with defaulting public entities of all sizes over the next couple of decades.

Britain and USA, to name a few, should learn responsibility. They lived over their means for decades, told others what's right or wrong. Now they have the gloomiest prospects.
The EU bureaucracy was happy with a government in Athens that fooled everybody. When a new government began to clean up, they remembered that a bad country should be treated in a strict manner.
That lighthouse, Germany, decided to forbid deficits altogether- constitutionally. WTF are public finances here for? To act procyclically? Isn't this idea the same as the procyclical effect of credit balloons?
Krugman said it clearly: when Brazil faced a lack of confidence last decade, the IMF ordered stiffling measures, so that "markets" were convinced that the usual regimen was been given. Thus, resulting to a deeper crisis.
It's dogma. The Soviet Union was in the same condition before you-know-the-fall-of-what.

I would not be surprised to see Europe in deep trouble as Greece, Ireland or Spain default on their debt. Today, for instance, Spain debt was downgraded to negative by S&P while Greece and Ireland keep on deteriorating their ranking profile.

As far as Greece is concerned the problem is that the Greek public behaves like a spoilt child.
They either do not accept that the country's finances are problematic, or do not admit to their responsibility in creating them or fixing them (ie. some "rich" people can be farmed for taxes), or finally, believe that they will con the rest of Europe into bailing the country out.
I believe that Greece needs some tough love. If it is to default it has to be allowed to do so.
Greeks need to learn responsibility, otherwise we will continue down the long path to being like an African state corrupted by foreign aid.

What does "economy" means?
- A Greek word : "oikonomia", two parts "oiko-nomos" = house - law.
Let's just imagine that Europe is a big family. Some kids are the "bad ones" - not following the rules. Some other are more "sophisticated" - they have good jobs, spending money and the "bads ones" ruin their "good profile". So they are yelling all the time trying to isolate the "rebels".

Well, giving this case, how should a parent manage this? Kicking them out or trying to be tolerate, having a parent talk? And what about the wealthy bros? So what is a family for, if not to help each other?

I agree that it's time for that kid to grow up and be responsible. But maybe one of his big brothers can find him a job and give him the oportunity to stand on his feet. Maybe they should change their point of viwe from sWoT to SwOt. Let's just exploit the good parts of his character and - whow knows - maybe that could be usefull for the entire family.

It's also the right time for the parents to ear spinn on some big brothers which are trying to make more money for themselves acting as usurers over the "weak brother". A brother in need is a brother indeed. Let's try to talk clearly and honestly, let's have a goodwill and jointly encounter the problem.